28 May 2010 12:25 [Source: ICIS news]
By Linda Naylor
LONDON (ICIS news)--European polyethylene (PE) and polypropylene (PP) prices are looking firmer for June, as availability of PP and some PE grades remains very tight and the likelihood of new material available from imports recedes, sources said on Friday.
“Fundamentals are unchanged,” said one low density PE (LDPE) producer. “Product is mega tight and we can get higher prices. June is a done deal.”
LDPE was widely considered the strongest PE grade and offers of $1,350/tonne (€1,094/tonne) FOB (free on board) from the ?xml:namespace>
LDPE net prices were reported in a wide range in June, at €1,250-1,300/tonne FD (free delivered) NWE (northwest Europe), the level around which new imported material would arrive in
The situation was too uncertain for July for importers to risk big volumes for arrival that month, but the rally of crude prices towards the end of this week already lifted sentiment in
On Friday morning Brent crude oil was trading at $75.24/bbl, up from its Monday level of $71.86/bbl. Such volatility added to concerns of converters in
“We have already lost one major contract to convert paper use to plastics,” said a frustrated converter. “They just don’t want to work in such a volatile environment.”
PP was in particularly short supply in
“We have decided to increase our initial offer of plus €25/tonne ($31/tonne) for June to plus €40-50/tonne,” said a major PP supplier. “Competitors are short. We can get bigger hikes.”
Total Petrochemicals retained force majeure restrictions on PP deliveries from Feluy in
Homopolymer PP injection prices were trading at €1,250-1,280/tonne FD NWE in June.
Sentiment over the direction of July pricing was mixed, and changed from day to day as crude affected sentiment in the key
There was concern that uncertainty over July would lead to special deals during the second half of June, weakening the upward momentum that was clearly in the market for next month. At present there was no sign of this, but softening in crude values could change the situation again, said market sources.
PP producers in
($1 = €0.81)
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